All of the following are features of a standard cost system except:

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Quizplus · Accepted Answer

The standard cost system does not determine the actual cost of manufacturing a unit. Instead, it establishes predetermined standards for the cost of materials, labor, and overhead for each unit of product. Variance analysis is used to determine the difference between the actual costs incurred and the standard costs, allowing for more timely action to be taken if necessary. The standards are based on estimates, but they are typically fixed for a period of time and do not change as conditions change.

All of the Following Are Features of a Standard Cost